Sharia compliant capital market grows positively: BEI

Padang, W Sumatra (ANTARA News) - The sharia compliant capital markets share in Indonesia increased by 5.4 percent in the past 10 years, the Indonesia Stock Exchange (BEI) has said.

"The sharia compliant capital markets share increased to 20 percent in 2013 from 13 percent in 2003," BEI Development Director Nicky Hogan said at a workshop here on Monday.

Sharia compliant capital market is that component of the capital market which applies sharia principles. It is not an independent unit but is part of the existing capital market.

The National Sharia Council of the Indonesian Ulema Council issued the sharia principles in the form of a religious edict (fatwa) that was incorporated in the Financial Service Authority (OJK)s regulation, he said.

At 59.2 percent, the share of the sharia compliant capital market in Asia currently is the highest in the world, he said.

Among the criteria for being sharia compliant capital is that the agreement, method and business activity serving as a basis for the issuance of shares must not be against the sharia principles, he said.

"As of now, 318 of 571 companies shares listed at the stock exchange are sharia compliant, not to mention 84 sharia compliant mutual funds," he said.

The BEI launched a Sharia Online Trading System (SOTS) in 2011 after it was certified by the National Sharia Council of the Indonesian Ulemas Council.

The executive chief of the OJKs capital market supervisory board, Nurhaida, said his side will issue regulations regarding sharia compliant capital market at the end of this year. (*)